India Gold Jewelers Back in Business, Ends 20-Day Nationwide Strike

Gold demand in India remained low after the country's gold bullion traders and jewelers ended their 20-day nationwide strike on Friday, but the gold entrepreneurs remained confident consumer interest on the precious safe haven yellow metal will pick up as the annual wedding season in the country begins.

"All shops have re-opened," Prithviraj Kothari, president of the Bombay Bullion Association, said in The Wall Street journal. "Gold demand should pick up.

"Few orders are there on the lower side... market is slowly gearing up ahead of Akshaya Tritiya," a dealer with a private bullion importing told Reuters News.

Most of the traders expected an influx of customers the moment the shops re-opened over the weekend. "However, the footfalls were much fewer than our expectations," gold trader Kumar Jain said in The Economic Times. 

On March 17, India's gold bullion traders and jewelers staged a simultaneous nationwide strike to protest the proposed hike in import duty on gold bars, coins and platinum in March to 4 per cent from 2 per cent, since the tax had already been doubled in January. New Delhi issued the proposal to increase revenue streams, dissuade gold buying as well as monitor its current-account deficit.

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The gold bullion traders and jewelers terminated their protest action on Friday after government assured them it would scrap the proposal.

Despite the low customer turnout this past weekend, the gold bullion traders and jewelers expect people to start a panic buying mode since Akshaya Tritiya, India's gold buying festival, is already due on April 24.

"I was waiting for the strike to end as I wanted to order a pair of bangles for my wife's birthday in June," a 44-year-old businessman said in The Wall Street journal.

However, this month's reopening and panic buying will still fail to create a major domino effect on India's gold imports.

Although Mr Kothari forecasts combined April and May imports will hit 100 metric tonnes, this is still a dismal 30 per cent slide compared to a year ago, the The Wall Street Journal reported.

Read more:

Indian Gold Imports Down in Q1, Q2 Purchases Also Seen Skidding

Indian Jeweler Gets Go Signal to Import Gold